Riding on higher credit offtake in the retail and MSME segment, Oriental Bank of Commerce is well on course to register a bottomline of at least ₹ 1,000 crore this fiscal, a top bank official said.
“I continue to maintain the guidance given by me at the beginning of this fiscal — that we will post a net profit of at least ₹1,000 crore this fiscal. Already at the half way stage this fiscal, we have recorded a net profit that exceeds the entire last year bottomline,” Animesh Chauhan, Managing Director and CEO, said at a press meet, where the second quarter results of the bank were announced.
For the second quarter ended September 30, OBC reported a 3.4 per cent increase in net profit t at ₹301.31 crore (₹291.42 crore).
This bottomline performance was 16.86 per cent higher than the net profit of ₹257.84 crore recorded in the first quarter this fiscal.
Chauhan attributed the better second quarter bottomline performance to lower slippage (non-performing assets), increased credit growth and more emphasis on the retail, agriculture and MSME (micro, small and medium enterprise) sectors.
Total income in the quarter grew 2.36 per cent year-on-year to ₹5,454.13 crore (₹5,328.57 crore)
For the six months ended September 30, OBC’s net profit stood at ₹559 crore, much higher than the ₹497 crore recorded in entire 2014-15.
On net interest margin, Chauhan expressed confidence that the bank would be able to keep it at 2.65-2.70 per cent for the entire fiscal, despite the recent reduction in base rate.
Stating that the NPA situation is still a source of worry, Chauhan said that the bank had increased the focus on recoveries and was also doing some “handholding” of accounts.
Cash recovery and upgradation for the quarter under review stood at ₹548 crore, higher than the ₹340 crore in the same quarter last year.
Sequentially, gross NPA fell to 5.70 per cent from 5.85 per cent in the first quarter, and net NPA to 3.55 per cent from 3.76 per cent.